"The corporate sector has taken on a substantial amount of debt in the current business cycle," LaVorgna wrote in a note to clients. "Non-financial corporate debt has increased by $2 trillion from its trough in Q4 2010."

A breakdown from analysts at S&P earlier this month found that corporate debt had risen at the 2,000 or so largest US firms to $6.6 trillion to end 2015, up from $3.8 trillion at the end of 2010.

"An over-tightening of credit conditions would be problematic for a highly levered corporate sector, especially if final demand were to remain weak," he said in the note.

"If capital costs were rising in an environment of declining margins, employers would at minimum slow the pace of hiring, and perhaps even cut labor outright. This may already be occurring, given the broad-based weakness of the May employment report."

The idea here is that as it becomes more expensive for companies to service debt, they will cut back on labor costs. In turn, consumers stop spending as they get worried about their jobs, and this decreases income for businesses, creating a cycle of slowing ending in recession.